France’s financial watchdog has granted Euroclear a license under the central securities depository regulation (CSDR).
The license enables Euroclear France to carry on providing securities settlement and tri-party collateral management services in the country.
The approval by the Autorite des marches financiers (AMF) also places Euroclear under the European regulatory framework.
Local CSD’s are required to be granted authorisation by their national regulator under CSDR. Belgium is the other country Euroclear has won CSDR approval where it is approved as an international CSD. It has yet to win a CSDR license for Finland and the UK.
Approved in 2014, CSDR created a common framework for CSDs and trade settlement within the EU. Among CSDR’s provisions are penalties for settlement failures, which some believe will introduce greater discipline in the market.
These penalties will accumulate on a daily basis beginning at the point at which the trade was supposed to be settled, and concluding at the time of actual settlement or at the end of the buy-in process. CSDs, meanwhile, will be obliged to monitor and report details of settlement fails to local regulators.